The Company has a defined contributory profit-sharing plan which includes provisions of a 401(k) plan. The plan permits employees to make pre-tax contributions, not to exceed the limits set by the Internal Revenue Service. The amount of contributions to the plan, including matching contributions, is at the discretion of the Board of Directors. All employees over the age of 21 are eligible to participate in the plan and receive Company contributions after 90 days of employment. Eligible employees are able to contribute to the Plan at the beginning of the first quarterly period after their date of employment. Employee contributions vest immediately, and any Company contributions are fully vested after four years. The Company’s contributions are expensed as the cost is incurred, funded currently, and amounted to $1,270,000 and $1,310,000 for the years ended December 31, 2023 and 2022, respectively.

The Company has several non-qualified supplemental executive retirement plans for the benefit of certain executive officers and former officers. At December 31, 2023 and 2022, other liabilities include $3,697,000 and $3,518,000 accrued under the Plan. Compensation expense includes approximately $655,000 and $461,000 relating to the supplemental executive retirement plan for 2023 and 2022, respectively. To fund the benefits under this plan, the Company is the owner of single premium life insurance policies on participants in the non-qualified retirement plan. At December 31, 2023 and 2022, the cash value of these policies was $46,439,000 and $43,364,000, respectively.

The Company provides postretirement benefits in the form of split-dollar life arrangements to employees who meet the eligibility requirements. The net periodic postretirement benefit expense included in salaries and employee benefits was $87,000 and $101,000 for the years ended December 31, 2023 and 2022, respectively.

FASB authoritative guidance on accounting for deferred compensation and postretirement benefit aspects of endorsement split-dollar life insurance arrangements requires the recognition of a liability and related compensation expense for endorsement split-dollar life insurance that provides a benefit to an employee that extends to postretirement periods. The life insurance policies purchased for the purpose of providing such benefits do not effectively settle an entity’s obligation to the employee. Accordingly, the entity must recognize a liability and related compensation expense during the employee’s active service period based on the future cost of insurance to be incurred during the employee’s retirement. This expense is included in the SERP plan expense for 2023 and 2022 discussed above. If the entity has agreed to provide the employee with a death benefit, then the liability for the future death benefit should be recognized by following the FASB authoritative guidance on employer’s accounting for postretirement benefits other than pensions. The accumulated postretirement benefit obligation was $1,818,000 and $1,731,000 at December 31, 2023 and 2022, respectively.

Certain key executives have change in control agreements with the Company. These agreements provide certain potential benefits in the event of termination of employment following a change in control.

The Company participates in the Pentegra Mulitemployer Defined Benefit Pension Plan (EIN 13-5645888 and Plan # 333) as a result of its acquisition of North Penn. As of December 31, 2023 and 2022, the Company’s Plan was 102.0% and 106.7% funded,

respectively, and total contributions made are not more than 5% of the total contributions to the Plan. The Company’s expense related to the Plan was $7,000 in 2023 and $11,000 in 2022. During the plan years ending December 31, 2023 and 2022, the Company made contributions of $7,000 and $11,000, respectively.

As a result of its acquisition of Delaware, the Company is a member of the New York State Bankers Retirement System. Substantially all full-time employees who were former employees of Delaware are covered under this defined benefit pension plan (the “Delaware Plan”). The Company’s funding policy is to contribute at least the minimum required contribution annually. Pension cost is computed using the projected unit credit actuarial cost method. Effective December 31, 2012, the Delaware Plan was closed to new participants and accrued benefits were frozen.

The following table sets forth the projected benefit obligation and change in plan assets for the Delaware Plan at December 31:



(in Thousands)	2023		2022
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	(5,747)	$	(7,622)
Service cost		—		—
Interest cost		(299)		(216)
Actuarial (gain) loss		(110)		1,615
Benefits paid		464		476
Benefit obligation at end of year	$	(5,692)	$	(5,747)
Change in plan assets:
Fair value of plan assets at beginning of year	$	5,205	$	7,691
Actual return on plan assets		315		(1,933)
Benefits paid		(544)		(553)
Fair value of assets at end of year		4,976		5,205
Funded status at end of year	$	(716)	$	(542)

The Delaware Plan paid $464,000 and $476,000 in benefit payments in 2023 and 2022, respectively. Estimated benefit payments under the Delaware Plan are expected to be approximately $457,000, $443,000, $442,000, $433,000 and $422,000 for the next five years. Payments are expected to be approximately $2,040,000 in total for the five-year period ending December 31, 2033. The Company was not required to make any contributions to the Delaware Plan in 2023 or 2022. The decrease in the projected discount rate from 5.44% to 5.18% increased the projected benefit obligation for the year ended December 31, 2023 by approximately $138,000.

The accumulated benefit obligation for the Delaware Plan was $5,692,000 and $5,747,000 at December 31, 2023 and 2022, respectively.

The following table sets forth the amounts recognized in accumulated other comprehensive income (loss) for the years ended December 31 (in thousands):


	2023		2022
Transition asset	$	—	$	—
Prior service credit		—		—
(Loss) gain		625		731
Total	$	625	$	731

Net pension cost (income) included the following components (in thousands):



	2023		2022
Service cost benefits earned during the period	$	—	$	—
Interest cost on projected benefit obligation		299		216
Actual return on assets		(220)		(336)
Net amortization and deferral		(11)		(53)

Net periodic pension cost (income)	$	68	$	(173)

The weighted average assumptions used to determine the benefit obligation at December 31 are as follows:



	2023		2022
Discount rate	5.18	%	5.44	%

The weighted average assumptions used to determine the net periodic pension cost at December 31 are as follows:

The expected long-term return on plan assets was determined based upon expected returns on individual asset types included in the asset portfolio.

The Delaware Plan’s weighted-average asset allocations at December 31, by asset category, are as follows:

The New York Bankers Retirement System (“System”) overall investment strategy is to invest in a diversified portfolio while managing the variability between the assets and projected liabilities of underfunded pension plans. Substantially all of the System’s assets to one fund, Commingled Pensions Trust Fund (LDI Diversified Balanced) of JPMorgan Chase Bank, N.A. (“JPMCBLDI Diversified Balanced Fund” or the “Fund”). The Fund is a collective investment fund managed by the Trustee under the Declaration of Trust. The Trustee is the Fund’s manager and makes day-to-day investment decisions for the Fund. The Fund is a group trust within the meaning of Internal Revenue Service Revenue Ruling 81-100, as amended. In reliance upon exemptions from the registration requirements of the federal securities laws, neither the Fund nor the Fund’s Units are registered with the Securities and Exchange Commission (“SEC”) or any state securities commission. Because the Fund is not subject to registration under federal or state securities laws, certain protections that might otherwise be provided to investors in registered funds are not available to investors in the Fund. However, as a bank-sponsored collective investment trust holding qualified retirement plan assets, the Fund is required to comply with applicable provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the Trustee is subject to supervision and regulation by the Office of the Comptroller of the Currency and the Department of Labor.

The Fund employs a liability driven investing (“LDI”) strategy for pension plans that are seeking a solution that is balanced between growth and hedging. The Bloomberg Barclays Long A U.S. Corporate Index, the Fund’s primary liability-performance benchmark, is used as a proxy for plan projected liabilities. The growth-oriented portion of the Fund invests in a mix of asset classes that the Fund’s Trustee believes will collectively maximize total risk-adjusted return through a combination of capital appreciation and income. This portion of the Fund will comprise between 35% and 90% of the portfolio and will invest directly or indirectly via underlying funds in a broad mix of global equity, credit, global fixed income, real estate and cash-plus strategies. The remaining portion of the Fund, between 10% and 65% of the portfolio, provides exposure to U.S. long duration fixed income and is used to minimize volatility relative to a plan’s projected liabilities. This portion of the Fund will invest directly or indirectly via underlying funds in investment grade corporate bonds and securities issued by the U.S. Treasury and its agencies or instrumentalities.

At December 31, 2023 and 2022, the portfolio was substantially managed by one investment firm who manages approximately 98% and 96%, respectively, of the System’s assets. Also, at December 31, 2023 and 2022, approximately $2.6 million and $7.0 million, respectively, of System’s assets in the short-term investment fund (STIF) account had not yet been allocated to an investment firm, nor deployed for benefit payments or expenses.

At December 31, 2023 and 2022, the System had an investment concentration of approximately 98% and 96%, respectively, of its total portfolio in the JPMCB LDI Diversified Balanced Fund, a commingled pension trust fund managed by one investment firm..